Does Public Sector Inefficiency Constrain Firm Productivity PDF Download

Author: Raffaela Giordano
Publisher: International Monetary Fund
ISBN: 1513580639
Category : Business & Economics
Languages : en
Pages : 26

View

Book Description
This paper studies the effect of public sector efficiency on firm productivity using data from more than 400,000 firms across Italy’s provinces. Exploiting the large heterogeneity in the efficiency of the public sector across Italian provinces and the intrinsic variation in the dependence of industries on the government, we find that public sector inefficiency significantly reduces the labor productivity of private sector firms. The results suggest that raising public sector efficiency could yield large economic benefits: if the efficiency in all provinces reached the frontier, output per employee for the average firm would increase by 9 percent.

Author: Kevin J. Fox
Publisher: Springer Science & Business Media
ISBN: 1475735928
Category : Business & Economics
Languages : en
Pages : 305

View

Book Description
Regardless of where we live, the management of the public sector impacts on our lives. Hence, we all have an interest, one way or another, in the achievement of efficiency and productivity improvements in the activities of the public sector. For a government agency that provides a public service, striving for unreasonable benchmark targets for efficiency may lead to a deterioration of service quality, along with an increase in stress and job dissatisfaction for public sector employees. Slack performance targets may lead to gross inefficiency, poor quality of service, and low self-esteem for employees. In the case of regulation, inappropriate policies can lead to unprecedented disasters. Examples include the decimation of fish stocks through mismanagement of fisheries, and power blackouts through inappropriate restrictions on electricity generators and distributors. Efficient taxation policies minimise the tax bill for citizens. In all of these cases, efficient management is required, although it is often unclear how to assess this efficiency. In this volume, several authors consider various aspects and contexts of performance measurement. Hence, this volume represents a unique collection of advances in efficiency assessment for the public sector by leading researchers in the field. Efficiency in the Public Sector is divided into two sections. The first is titled "Issues in Public Sector Efficiency Evaluation" and comprises of chapters 1-4. The second section is titled "Efficiency Analysis in the Public Sector - Advances in Theory and Practice." This division is somewhat arbitrary, in the sense there are significant overlapping themes in both sections. However, it serves to separate chapters that can be characterised as dealing with broader issues (Section I), from chapters that can be characterised as focusing on specific theoretical problems and empirical cases (Section II).

Author: International Monetary Fund
Publisher: International Monetary Fund
ISBN: 1451968515
Category : Business & Economics
Languages : en
Pages : 25

View

Book Description
This paper uses a simple model to analyze the forces that determine the size of the public sector and the quality of workers employed in that sector. Workers are heterogeneous, and the public sector chooses an employment strategy that maximizes a social welfare function U(s, Y) that depends on the share of the labor force employed in public service s and private sector output Y. The government is fully informed about worker productivity. By examining the welfare properties of the possible outcomes, we are able to illuminate situations in which policies that seek to constrain the public sector may or may not improve economic efficiency.

Author: Ann Bartel
Publisher:
ISBN:
Category : Government ownership
Languages : en
Pages : 50

View

Book Description
In this paper we disentangle the sources of public sector inefficiency using 1982-1995 panel data on manufacturing firms in Indonesia. We consider two leading hypotheses: (1) public sector enterprises are inefficient due to monitoring problems and (2) public sector enterprises are inefficient because of the environment in which they operate, as measured by the soft budget constraint. The two models are nested in a production function framework and the empirical results provide support for the second hypothesis. Public sector enterprises are inefficient because of their access to soft loans; public sector ownership has no independent impact on productivity growth. The finding that ownership per se does not matter, but environment does, holds when we control for fixed effects and when we allow for the endogeneity of government loans. Interestingly, private sector firms with access to government loans did not perform more poorly than other private sector enterprises. Another dimension of the environment, i.e. import penetration, also matters; public sector enterprises that have been shielded from import competition are inferior performers

Author: International Monetary Fund. European Dept.
Publisher: International Monetary Fund
ISBN: 1513559680
Category : Business & Economics
Languages : en
Pages : 74

View

Book Description
This Selected Issues paper establishes a causal link between public sector efficiency at the provincial level and firm productivity using data for about 450,000 Italian firms. It emphasizes that significant productivity gains could be realized if public sector efficiency improves from currently low levels. If efficiency rises to the frontier in all provinces, output per employee would increase 9 percent for the average firm. Implementing the public administration reform agenda and recommendations of the 2014 spending review and competition authority could help deliver some of these productivity gains.

Author: Mr.Sergi Lanau
Publisher: International Monetary Fund
ISBN: 1475524927
Category : Business & Economics
Languages : en
Pages : 25

View

Book Description
This paper examines the role of removing obstacles to competition in product markets in raising growth and productivity. Using firm-level data from Italy during 2003–13 and OECD measures of product market regulation, we estimate the effect of deregulation in network sectors on value added and productivity of firms in these sectors, as well as firms using these intermediates in their production processes. We find evidence of a significant positive impact. These effects are more pronounced in Italian provinces with more efficient public administration, underscoring the complementarities of advancing public administration and product market reforms simultaneously.

Author: Samya Beidas-Strom
Publisher: International Monetary Fund
ISBN: 1475578962
Category : Business & Economics
Languages : en
Pages : 44

View

Book Description
This paper estimates public sector service efficiency in England at the sub-regional level, studying changes post crisis during the large fiscal consolidation effort. It finds that despite the overall spending cut (and some caveats owing to data availability), efficiency broadly improved across sectors, particularly in education. However, quality adjustments and other factors could have contributed (e.g., sector and technology-induced reforms). It also finds that sub-regions with the weakest initial levels of efficiency converged the most post crisis. These sub-regional changes in public sector efficiency are associated with changes in labor productivity. Finally, the paper finds that regional disparities in the productivity of public services have narrowed, especially in the education and health sectors, with education attainment, population density, private spending on high school education and class size being to be the most important factors explaining sub-regional variation since 2003.

Author: OECD
Publisher: OECD Publishing
ISBN: 9264270183
Category :
Languages : en
Pages : 156

View

Book Description
This 2017 OECD Economic Survey of Italy examines recent economic developments, policies and prospects. The special chapters cover raising business investment and enhancing skills.

Author: Ms. Emilia M Jurzyk
Publisher: International Monetary Fund
ISBN: 1513571923
Category : Business & Economics
Languages : en
Pages : 45

View

Book Description
We document that publicly listed Chinese state-owned enterprises (SOEs) are less productive and profitable than publicly listed firms in which the state has no ownership stake. In particular, Chinese listed SOEs are more capital intensive and have a lower average product of capital than non-SOEs. These productivity differences increased between 2002 and 2009, and remain sizeable in 2019. Using a heterogeneous firm model of resource misallocation, we find that there are large potential productivity gains from reforms which could equalize the marginal products of listed SOEs and listed non-SOEs.

Author: International Monetary Fund
Publisher: International Monetary Fund
ISBN: 1498344119
Category : Business & Economics
Languages : en
Pages : 64

View

Book Description
Structural policies have become a prominent feature of today’s macroeconomic policy discussion. For many countries, lackluster economic growth and high unemployment cloud the outlook. With fewer traditional policy options, policymakers are increasingly focused on the complementary role of structural policies in promoting more durable job-rich growth. In particular, the G20 has emphasized the essential role of structural reforms in ensuring strong, sustainable and balanced growth. Against this backdrop, the 2014 Triennial Surveillance Review (TSR) called for further work to enhance the Fund’s ability to selectively provide more expert analysis and advice on structural issues, particularly where there is broad interest among member countries. The purpose of this paper is to engage the Board on staff’s post-TSR work toward strengthening the Fund’s capacity to analyze and, where relevant, offer policy advice on macro-relevant structural issues.